Car Shopping Chronicles, Season 3, Part 5

I ended the last entry in this series noting something happened following my visit to the VW dealership that changed my car search. I’m sure you’ve been on pins and needles since reading that, anticipating the next reveal. Wait no more!

Later that evening I got a text from a VW sales manager saying they would love to work with me to get out of my Tesla lease early and into the Tiguan they wanted me to drive. Well, he didn’t say that last part but it was implied.

When salespeople start dancing for me, I’m happy to put a couple quarters in the jukebox and see what happens.

I let him know I’d love to take a look at whatever he could put together for me.

Then it was back to the car research tabs in Safari. I hammered all the details on my car buying spreadsheet. Then S and I sat down and reviewed it next to the spreadsheet she keeps that shows our general financial health. If I got a great offer to get out of the Tesla lease, what were we prepared to spend, would we want to lease or buy, and finally, which car should we focus on? We had some answers before she went to bed.

Something was tickling the back of my head, though. Eventually it hit me: I remembered that Tesla does not allow you to buy out a lease early. They have relaxed this language a little, but it stems from their early days when they wanted to both control the used Tesla market inventory and have the option to cycle used car batteries into their solar power systems.

More searching confirmed that a third party cannot buy out a lease done directly through Tesla, as mine was.

Bummer. VW guy was going to be disappointed. And while that momentary jolt of excitement was fun, I would remain on track to get a new car in the spring.

The next morning I decided to do recheck my work, to be sure there were no lease buyout options. I don’t know why it didn’t pop up immediately, but eventually I found a link to Tesla’s own finance page that listed how a lessee can get out of their contract early. In typical Tesla fashion it is dead easy, and I was on the right side of a deadline to do it.1

I opened the Tesla app on my phone and navigated to the option to end lease early. I answered a few questions, requested a quote, and within a few minutes got a listing of what it would cost to get out of my lease.

My car’s value was greater than its adjusted lease balance. If I accepted their offer, I could get out of the lease without paying anything. In fact, the delta between car value and lease value would cover their standard $400 Disposition Fee you pay when turning a car back into them.2 The obvious issue with how Tesla manages this process is that if my car was worth several thousand more than the remaining lease balance, all that equity would go to them. My lease doesn’t even allow me to purchase the car from them and turn around and sell it for the difference.

But this was interesting!

The quote was not binding so there was no harm in accepting it. The language was clear that if my next payment was drawn, the quote would expire.

Oh, here’s another detail I should note: a week earlier I had won the Rivian lottery! Despite being told after placing my deposit that it would be late December/early January before I could order an R2, somehow I jumped to the top of the list. They must have wanted to give me more content for the site.3

That night S and I again looked at our spreadsheets and discussed our options. I sent a couple text messages making appointments for Halloween morning.

You’ll hear about those in Part 6.

  1. Simply put, Tesla treats you differently by whether you have more or less than three lease payments left. We had five. Various market factors determine whether you are on the good or bad side of that divide. In my case it worked out well, but I’m not sure how different the math would have been if we did this in January. ↩︎

  2. Bastards. ↩︎

  3. It may have also been a glitch. ↩︎